MERRY LAND & INVESTMENT COMPANY, INC.
Debt Securities
Underwriting Agreement
October 27, 1997
FIRST UNION CAPITAL MARKETS CORP.
000 XXXXX XXXXXXX XXXXXX
XXXXXXXXX, XXXXX XXXXXXXX 00000
LADIES AND GENTLEMEN:
Merry Land & Investment Company, Inc., a Georgia corporation (the
"Company"), proposes to issue and sell to YOU (the "Underwriter"), the
principal amount of its debt securities identified in Schedule I hereto
(the "Securities"), to be issued under the indenture specified in Schedule
I hereto (the "Indenture") between the Company and the Trustee identified
in such Schedule (the "Trustee").
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement (the file number of which is set forth in Schedule I hereto) on
Form S-3, relating to certain securities (the "Shelf Securities") to be
issued from time to time by the Company. The Company also has filed with,
or proposes to file with, the Commission pursuant to Rule 424 under the
Securities Act a prospectus supplement specifically relating to the
Securities. The registration statement as amended to the date of this
Agreement is hereinafter referred to as the "Registration Statement" and
the related prospectus covering the Shelf Securities in the form first used
to confirm sales of the Securities is hereinafter referred to as the "Basic
Prospectus". The Basic Prospectus as supplemented by the prospectus
supplement specifically relating to the Securities in the form first used
to confirm sales of the Securities is hereinafter referred to as the
"Prospectus". Any reference in this Agreement to the Registration
Statement, the Basic Prospectus, any preliminary form of Prospectus (a
"preliminary prospectus") previously filed with the Commission pursuant to
Rule 424 or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act which were filed under the Securities Exchange Act
of 1934, as amended, and the rules and regulations of the Commission
thereunder (collectively, the "Exchange Act") on or before the date of this
Agreement or the date of the Basic Prospectus, any preliminary prospectus
or the Prospectus, as the case may be; and any reference to "amend",
"amendment" or "supplement" with respect the Registration Statement, the
Basic Prospectus, any preliminary prospectus or the Prospectus shall be
deemed to refer to and include any documents filed under the Exchange Act
after the date of this Agreement, or the date of the Basic Prospectus, any
preliminary prospectus or the Prospectus, as the case may be, which are
deemed to be incorporated by reference therein.
The Company hereby agrees with the Underwriter as follows:
1. The Company agrees to issue and sell the Securities to the
Underwriter as hereinafter provided, and the Underwriter, on the basis of
the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees to purchase from the Company the
Securities at the purchase price set forth in Schedule I hereto plus
accrued interest, if any, from the date specified in Schedule I hereto to
the date of payment and delivery.
2. The Company understands that the Underwriter intends (i) to make
a public offering of their respective portions of the Securities and (ii)
initially to offer the Securities upon the terms set forth in the
Prospectus.
3. Payment for the Securities shall be made to the Company or to its
order in immediately available funds on the date and at the time and place
set forth in Schedule I hereto (or at such other time and place on the same
or such other date, not later than the third Business Day thereafter, as
you and the Company may agree in writing). Such payment will be made upon
delivery to, or to you for the respective accounts of, the Underwriter of
the Securities registered in such names and in such denominations as you
shall request not less than two full Business Days prior to the date of
delivery, with any transfer taxes payable in connection with transfer to
the Underwriter duly paid by the Company. As used herein, the term
"Business Day" means any day other than a day on which banks are permitted
or required to be closed in New York City. The time and date of such
payment and delivery with respect to the Securities are referred to herein
as the Closing Date. The certificates for the Securities will be made
available for inspection and packaging by you by 1:00 P.M. on the Business
Day prior to the Closing Date at such place in New York City as you and the
Company shall agree.
4. The Company represents and warrants to the Underwriter that:
(a) the Registration Statement has been declared effective by the
Commission under the Securities Act; no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge
of the Company, threatened by the Commission; and the Registration
Statement and Prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) comply, or
will comply, as the case may be, in all material respects with the
Securities Act and the Trust Indenture Act of 1939, as amended, and
the rules and regulations of the Commission thereunder (collectively,
the "Trust Indenture Act"), and do not and will not, as of the
applicable effective date as to the Registration Statement and any
amendment thereto and as of the date of the Prospectus and any
amendment or supplement thereto, contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and the
Prospectus, as amended or supplemented at the Closing Date, if
applicable, will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; except that the foregoing representations and
warranties shall not apply to (i) that part of the Registration
Statement which constitutes the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of the Trustee,
and (ii) statements or omissions in the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
relating to the Underwriter furnished to the Company in writing by the
Underwriter expressly for use therein;
(b) the documents incorporated by reference in the Prospectus,
when they were filed with the Commission, conformed in all material
respects to the requirements of the Exchange Act, and none of such
documents contained an untrue statement of a material fact or omitted
to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents are filed with the
Commission will conform in all material respects to the requirements
of the Exchange Act, as applicable, and will not contain an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(c) the consolidated financial statements and the related notes
thereto, included or incorporated by reference in the Registration
Statement and the Prospectus, present fairly the financial position of
the Company and its Subsidiaries as of the dates indicated and the
consolidated results of its operations and the changes in its cash
flows for the periods specified; the financial statements with respect
to the properties acquired or to be acquired by the Company, together
with related notes and schedules as set forth or incorporated by
reference in the Registration Statement or the Prospectus, present
fairly the financial position and the results of operations of such
properties at the indicated dates and for the indicated periods; the
foregoing financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis, and the supporting schedules included or incorporated by
reference in the Registration Statement or the Prospectus present
fairly the information required to be stated therein; the summary
financial and statistical data included or incorporated by reference
in the Registration Statement or the Prospectus present fairly the
information shown therein and have been compiled on a basis consistent
with the financial statements presented therein; and the pro forma
financial information, and the related notes thereto, included or
incorporated by reference in the Registration Statement and the
Prospectus has been prepared in accordance with the applicable
requirements of the Securities Act and the Exchange Act, as
applicable;
(d) since the respective dates as of which information is given
in the Registration Statement and the Prospectus, there has not been
any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general
affairs, business, prospects, management, properties, financial
position, stockholders' equity or results of operations of the
Company, otherwise than as set forth or contemplated in the
Prospectus; and except as set forth or contemplated in the Prospectus
the Company has not entered into any transaction or agreement (whether
or not in the ordinary course of business) material to the Company;
(e) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the state
of its incorporation, with power and authority (corporate and other)
to own or lease its properties and conduct its business as described
in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or in
good standing would not have a material adverse effect on the Company
and its subsidiaries taken as a whole; except for investments in
securities as described in the Registration Statement or Prospectus,
the Company has no equity or other interest in, or rights to acquire,
an equity or other interest in any corporation, partnership, trust or
other entity; the subsidiary entities of the Company identified on
Schedule II hereto (the "Subsidiaries") have been duly organized and
are validly existing as corporations or limited partnerships, as the
case may be, in good standing under the laws of their states of
organization, and have been duly qualified as foreign corporations or
limited partnerships, as the case may be, for the transaction of
business and are in good standing under the laws of each other
jurisdiction in which they own or lease properties, or conduct any
business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a
material adverse effect on the Company and its Subsidiaries taken as a
whole; except for investments in securities as described in the
Registration Statement or Prospectus, the Company and the Subsidiaries
have no equity or other interest in, or rights to acquire, an equity
or other interest in any corporation, partnership, trust or other
entity;
(f) this Agreement and the Indenture have been duly authorized,
executed and delivered by the Company and constitute the valid and
legally binding obligations of the Company enforceable in accordance
with their terms, except as rights to indemnity and contribution
hereunder may be limited by applicable law;
(g) the Securities have been duly authorized, and, when issued,
authenticated and delivered pursuant to this Agreement and the
Indenture will have been duly and validly executed, authenticated,
issued and delivered and will constitute valid and binding obligations
of the Company entitled to the benefits provided by the Indenture; the
Indenture has been duly authorized and has been duly qualified under
the Trust Indenture Act and, when executed and delivered by the
Company and the Trustee, the Indenture will constitute a valid and
binding instrument; and the Securities and the Indenture will conform
to the statements relating thereto contained in the Prospectus;
(h) neither the Company nor the Subsidiaries is, nor with the
giving of notice or lapse of time or both would be, in violation of or
in default under, their respective Articles of Incorporation or By-
Laws or any indenture, mortgage, deed of trust, loan agreement or
other agreement or other instrument or obligation to which the Company
or any Subsidiary is a party or by which they or any of their
properties are bound, except for violations and defaults which
individually and in the aggregate are not material to the Company or
to the holders of the Securities; the issue and sale of the Securities
and the performance by the Company of all of the provisions of its
obligations under the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other material agreement or
instrument to which the Company or any Subsidiary is a party or by
which the Company or any Subsidiary is bound or to which any of the
property or assets of the Company or any Subsidiary is subject, nor
will any such action result in any violation of the provisions of the
Articles of Incorporation or the By-Laws of the Company or any
applicable law or statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company or any of its properties; and no consent, approval,
authorization, order, registration or qualification of or with any
such court or governmental agency or body is required for the issue
and sale of the Securities or the consummation by the Company of the
transactions contemplated by this Agreement or the Indenture, except
such consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act, the
Trust Indenture Act and as may be required under state securities or
Blue Sky Laws in connection with the purchase and distribution of the
Securities by the Underwriters;
(i) other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any
Subsidiary is or may be a party or to which any property of the
Company or any Subsidiary is or may be the subject which, if
determined adversely to the Company, could individually or in the
aggregate reasonably be expected to have a material adverse effect on
the general affairs, business, prospects, management, properties,
financial position, stockholders' equity or results of operations of
the Company and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others; and there are no contracts or other documents
of a character required to be filed as an exhibit to the Registration
Statement or required to be described in the Registration Statement or
the Prospectus which are not filed or described as required;
(j) the Company and the Subsidiaries have good and marketable
title to all of the properties and assets reflected in the financial
statements (or as described in the Registration Statement) hereinabove
described, subject to no lien, mortgage, pledge, charge or encumbrance
of any kind except those reflected in such financial statements (or as
described in the Registration Statement) or which are not material in
amount. The Company and the Subsidiaries occupy their leased
properties under valid and binding leases conforming to the
description thereof set forth in the Registration Statement;
(k) the Company has filed all Federal, State and foreign income
tax returns which have been required to be filed and have paid all
taxes indicated by said returns and all assessments received by it to
the extent that such taxes have become due and are not being contested
in good faith;
(l) the Company and the Subsidiaries hold all material licenses,
certificates and permits from governmental authorities which are
necessary to the conduct of their business; and the Company has not
infringed any patents, patent rights, trade names, trademarks or
copyrights, which infringement is material to the business of the
Company;
(m) Xxxxxx Xxxxxxxx LLP, who have certified certain of the
financial statements filed with the Commission as part of, or
incorporated by reference in, the Registration Statement, are
independent public accountants as required by the Securities Act;
(n) the Company has never been, is not now, and immediately after
the sale of the Securities under this Agreement will not be, an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended;
(o) with respect to all tax periods regarding which the Internal
Revenue Service is or will be entitled to assert any claim, the
Company has met the requirements for qualification as a real estate
investment trust under Sections 856 through 860 of the Internal
Revenue Code, as amended, and the Company's present and contemplated
operations, assets and income continue to meet such requirements; and
(p) the conditions for the use of a registration statement on
Form S-3 set forth in the General Instructions on Form S-3 have been
satisfied and the Company is entitled to use such form for the
transactions contemplated herein.
5. The Company covenants and agrees with the Underwriter as follows:
(a) to file the Prospectus in a form approved by you pursuant to
Rule 424 under the Securities Act not later than the Commission's
close of business on the second Business Day following the date of
determination of the offering price of the Securities;
(b) to deliver to the Underwriter and counsel for the
Underwriter, at the expense of the Company, a signed copy of the
Registration Statement (as originally filed) and each amendment
thereto, in each case including exhibits and documents incorporated by
reference therein and, during the period mentioned in paragraph (e)
below, to the Underwriter as many copies of the Prospectus (including
all amendments and supplements thereto) and documents incorporated by
reference therein as you may reasonably request, when filed with
Commission;
(c) from the date hereof and prior to the Closing Date, to
furnish to you a copy of any proposed amendment or supplement to the
Registration Statement or the Prospectus, for your review, and not to
file any such proposed amendment or supplement to which you reasonably
object;
(d) to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of the Securities, and during
such same period, to advise you promptly, and to confirm such advice
in writing, (i) when any amendment to the Registration Statement shall
have become effective, (ii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for any additional information, (iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation or
threatening of any proceeding for that purpose, and (iv) of the
receipt by the Company of any notification with respect to any
suspension of the qualification of the Securities for offer and sale
in any jurisdiction or the initiation or threatening of any proceeding
for such purpose; and to use its best efforts to prevent the issuance
of any such stop order or notification and, if issued, to obtain as
soon as possible the withdrawal thereof;
(e) if, during such period after the first date of the public
offering of the Securities as in the opinion of counsel for the
Underwriter a prospectus relating to the Securities is required by law
to be delivered in connection with sales by an Underwriter or dealer,
any event shall occur as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in
the light of the circumstances when the Prospectus is delivered to a
purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with law, forthwith to prepare and
furnish, at the expense of the Company, to the Underwriter and to the
dealers (whose names and addresses you will furnish to the Company) to
which Securities may have been sold by you on behalf of the
Underwriter and to any other dealers upon request, such amendments or
supplements to the Prospectus as may be necessary so that the
statements in the Prospectus as so amended or supplemented will not,
in the light of the circumstances when the Prospectus is delivered to
a purchaser, be misleading or so that the Prospectus will comply with
law;
(f) to endeavor to qualify the Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions as you
shall reasonably request and to continue such qualification in effect
so long as reasonably required for distribution of the Securities and
to pay all fees and expenses (including fees and disbursements of
counsel to the Underwriter) reasonably incurred in connection with
such qualification and in connection with the determination of the
eligibility of the Securities for investment under the laws of such
jurisdictions as you may designate; PROVIDED that the Company shall
not be required to file a general consent to service of process in any
jurisdiction;
(g) to make generally available to its security holders and to
you as soon as practicable but not later than 15 months after the
effective date of the Registration Statement (as defined in Rule
158(c)) an earnings statement covering a period of at least twelve
months beginning with the first fiscal quarter of the Company
occurring after the effective date of the Registration Statement,
which shall satisfy the provisions of Section 11(a) of the Securities
Act and Rule 158 of the Commission promulgated thereunder;
(h) so long as the Securities are outstanding, to furnish to you
copies of all reports or other communications (financial or other)
furnished to holders of Securities, and copies of any reports and
financial statements furnished to or filed with the Commission or any
national securities exchange;
(i) during the period beginning on the date hereof and continuing
to and including the Business Day following the Closing Date, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of or guaranteed by the Company which are substantially
similar to the Securities without your prior written consent; and
(j) to pay all costs and expenses incident to the performance of
its obligations hereunder, including without limiting the generality
of the foregoing, all costs and expenses (i) incident to the
preparation, issuance, execution, authentication and delivery of the
Securities, including any expenses of the Trustee, (ii) incident to
the preparation, printing and filing under the Securities Act of the
Registration Statement, the Prospectus and any preliminary prospectus
(including in each case all exhibits, amendments and supplements
thereto), (iii) incurred in connection with the registration or
qualification and determination of eligibility for investment of the
Securities under the laws of such jurisdictions as the Underwriter may
designate (including fees of counsel for the Underwriter and their
disbursements), (iv) in connection with the listing of the Securities
on any stock exchange, (v) related to any filing with National
Association of Securities Dealers, Inc., (vi) in connection with the
printing (including word processing and duplication costs) and
delivery of this Agreement, the Indenture, the Preliminary and
Supplemental Blue Sky Memoranda and any Legal Investment Survey and
the furnishing to Underwriter and dealers of copies of the
Registration Statement and the Prospectus, including mailing and
shipping, as herein provided and (vii) payable to rating agencies in
connection with the rating of the Securities.
6. The obligations of the Underwriter hereunder shall be subject to
the following conditions:
(a) the representations and warranties of the Company contained
herein are true and correct on and as of the Closing Date as if made
on and as of the Closing Date and the Company shall have complied with
all agreements and all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date;
(b) the Prospectus shall have been filed with the Commission
pursuant to Rule 424 within the applicable time period prescribed for
such filing by the rules and regulations under the Securities Act; no
stop order suspending the effectiveness of the Registration Statement
shall be in effect, and no proceedings for such purpose shall be
pending before or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your satisfaction;
(c) subsequent to the execution and delivery of this Agreement
and prior to the Closing Date, there shall not have occurred any
downgrading, nor shall any notice have been given of (i) any intended
or potential downgrading or (ii) any review or possible change that
does not indicate an improvement, in the rating accorded any
securities of or guaranteed by the Company by any "nationally
recognized statistical rating organization", as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act;
(d) since the respective dates as of which information is given
in the Prospectus there shall not have been any material adverse
change or any development involving a material adverse change, in or
affecting the general affairs, business, prospects, management,
properties, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a whole,
otherwise than as set forth or contemplated in the Prospectus, the
effect of which in the judgment of the Underwriter makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities on the terms and in the manner
contemplated in the Prospectus;
(e) the Underwriter shall have received on and as of the Closing
Date a certificate of an executive officer of the Company satisfactory
to you to the effect set forth in subsections (a) through (c) of this
Section and to the further effect that there has not occurred any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
business, prospects, management, properties, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole from that set forth or contemplated in
the Registration Statement.
(f) Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C., counsel for the
Company, shall have furnished to you its written opinion, dated the
Closing Date, in form and substance satisfactory to you, to the effect
that:
(i) the Company has been duly organized and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with power and authority
(corporate and other) to own its properties and conduct its
business as described in the Prospectus as then amended or
supplemented;
(ii) the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it
owns or leases properties, or conducts any business, so as to
require such qualification, other than where the failure to be so
qualified or in good standing would not have a material adverse
effect on the Company;
(iii) the Subsidiaries have been duly organized and are
validly existing as corporations or limited partnerships, as the
case may be, in good standing under the laws of their
jurisdictions of organization, with power and authority to own
their properties and conduct their business as described in the
Prospectus as amended or supplemented;
(iv) the Subsidiaries have been duly qualified as foreign
corporations or limited partnerships, as the case may be, for the
transaction of business and are in good standing under the laws
of each other jurisdiction in which they own or lease properties,
or conduct any business, so as to require such qualification,
other than where the failure to be so qualified or in good
standing would not have a material adverse effect on the Company;
(v) other than as set forth or contemplated in the
Prospectus, there are no legal or governmental proceedings
pending or, to the best of such counsel's knowledge, threatened
to which the Company or the Subsidiaries is or may be a party or
to which any property of the Company or the Subsidiaries is or
may be the subject which, if determined adversely to the Company
or the Subsidiaries, could individually or in the aggregate
reasonably be expected to have a material adverse effect on the
general affairs, business, prospects, management, properties,
financial position, stockholders' equity or results of operations
of the Company; to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental
authorities or threatened by others; and such counsel does not
know of any contracts or other documents of a character required
to be filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or the
Prospectus which are not filed or described as required;
(vi) this Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of
the Company, except as rights to indemnity and contribution
hereunder may be limited by applicable law;
(vii) the Securities have been duly authorized, and when
executed and authenticated in accordance with the terms of the
Indenture and delivered to and paid for by the Underwriter in
accordance with the terms of this Agreement, will constitute
valid and binding obligations of the Company entitled to the
benefits provided by the Indenture, enforceable in accordance
with their terms, except that the enforceability thereof may be
limited by or subject to (a) bankruptcy, reorganization,
insolvency, fraudulent conveyance, moratorium or other similar
laws now or hereafter existing which affect the rights and
remedies of creditors generally and (b) equitable principles of
general applicability;
(viii) the Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding
instrument of the Company enforceable in accordance with its
terms, except that the enforceability thereof may be limited by
or subject to (a) bankruptcy, reorganization, insolvency,
fraudulent conveyance, moratorium or other similar laws now or
hereafter existing which affect the rights and remedies of
creditors generally and (b) equitable principles of general
applicability; and the Indenture has been duly qualified under
the Trust Indenture Act;
(ix) neither the Company nor the Subsidiaries are, nor with
the giving of notice or lapse of time or both would be, in
violation of or in default under, their respective Articles of
Incorporation or By-Laws or any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to
such counsel to which the Company or any of the Subsidiaries is a
party or by which they or any of their respective properties are
bound, except for violations and defaults which individually and
in the aggregate are not material to the Company or to the
holders of the Securities; the issue and sale of the Securities
and the performance by the Company of its obligations under the
Securities, the Indenture and this Agreement and the consummation
of the transactions herein and therein contemplated will not
conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other material
agreement or instrument known to such counsel to which the
Company or any Subsidiary is a party or by which the Company or
any Subsidiary is bound or to which any of the property or assets
of the Company or any Subsidiary is subject, nor will any such
action result in any violation of the provisions of the Articles
of Incorporation or the By-Laws of the Company or any applicable
law or statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company
or any of its properties;
(x) the Company has authorized and outstanding stock as set
forth under the caption "Capitalization" in the Prospectus;
(xi) no consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the issue and sale of
the Securities or the consummation of the other transactions
contemplated by this Agreement or the Indenture, except such
consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act and
the Trust Indenture Act and as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriter;
(xii) the statements in the Prospectus under the captions
"Description of Notes," "Description of Debt Securities,"
"Description of Common Stock," "Description of Preferred Stock,"
"Description of Common Stock Warrants," and "Description of
Depositary Shares" in the Prospectus and each document
incorporated by reference from Item 3 of Part 1 of the Company's
Annual Report on Form 10-K for the year ended December 31, 1996
and in the Registration Statement in Item 15, insofar as such
statements constitute a summary of the legal matters, documents
or proceedings referred to therein, fairly present the
information called for with respect to such legal matters,
documents or proceedings;
(xiii) such counsel (A) is of the opinion that each
document incorporated by reference in the Registration Statement
and the Prospectus (except for the financial statements included
therein as to which such counsel need express no opinion)
complied as to form in all material respects with the Exchange
Act when filed with Commission, (B) believes that (except for the
financial statements included therein as to which such counsel
need express no belief) each part of the Registration Statement
(including the documents incorporated by reference therein) filed
with the Commission pursuant to the Securities Act relating to
the Securities, when such part became effective, did not contain
an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading, (C) is of the opinion that
the Registration Statement and the Prospectus and any amendments
and supplements thereto (except for the financial statement
included therein as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Securities Act and the Trust Indenture Act
and (D) believes that (except for the financial statements
included therein as to which such counsel need express no belief)
the Registration Statement and the Prospectus, on the date of
this Agreement, did not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and that the Prospectus as amended or supplemented,
if applicable, does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and
(xiv) the Company is not, and will not become as a result of
the consummation of the transactions contemplated by this
Agreement, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, and has not been an
"investment company" at any time since 1988.
In rendering such opinions, such counsel may rely (A) as to
matters involving the application of laws other than the laws of the
United States and the States of Georgia, to the extent such counsel
deems proper and to the extent specified in such opinion, if at all,
upon an opinion or opinions (in form and substance reasonably
satisfactory to Underwriter's counsel) of other counsel reasonably
acceptable to the Underwriter's counsel, familiar with the applicable
laws; (B) as to matters of fact, to the extent such counsel deems
proper, on certificates of responsible officers of the Company and
certificates or other written statements of officials of jurisdictions
having custody of documents respecting the corporate existence or good
standing of the Company. The opinion of such counsel for the Company
shall state that the opinion of any such other counsel is in form
satisfactory to such counsel and, in such counsel's opinion, the
Underwriter and they are justified in relying thereon. With respect
to the matters to be covered in subparagraph (xiii) above counsel may
state its opinion and belief is based upon their participation in the
preparation of the Registration Statement and the Prospectus and any
amendment or supplement thereto (other than the documents incorporated
by reference therein) and review and discussion of the contents
thereof (including the documents incorporated by reference therein)
but is without independent check or verification except as specified.
(g) Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C., tax counsel for the
Company, shall have delivered to you its written opinion, dated the
Closing Date, in form and substance satisfactory to you, to the effect
that:
(i) the Company met the requirements for qualification and
taxation as a real estate investment trust ("REIT") for the
taxable years 1990, 1991, 1992, 1993, 1994, 1995 and 1996;
(ii) the Company's diversity of stock ownership and proposed
method of operation should allow it to qualify as a REIT for
1997; and
(iii) the discussion contained under the caption "Certain
Federal Income Tax Considerations to the Company of its REIT
Election" in the Prospectus forming a part of the Registration
Statement, accurately reflects existing law and fairly addresses
the material federal income tax issues described therein.
In rendering such opinions, Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C.
may rely as to matters of fact, to the extent they deem proper, on
certificates of officers of the Company and public officials so long
as such counsel states that no facts have come to the attention of
such counsel which lead them to believe that they are not justified in
relying on such certificates. In addition, Hull, Xxxxxx, Xxxxxx &
Xxxxxxx, P.C. may state that their opinions are based upon the
procedures and assumptions set forth in such opinion letter and that
it is limited to the tax matters specifically covered thereby and that
they have not addressed any other tax consequences.
(h) on the Closing Date, Xxxxxx Xxxxxxxx LLP shall have furnished
to you letters, dated such date, in form and substance satisfactory to
you, containing statements and information of the type customarily
included in accountants "comfort letters" to underwriters with respect
to the financial statements and certain financial information
contained or incorporated by reference in the Registration Statement
and the Prospectus;
(i) on the Closing Date, Xxxxxx Xxxxxxxx LLP shall have furnished
to you a letter confirming the matters set forth in clauses (i) and
(ii) of subparagraph (g) of this Section 6;
(j) you shall have received on and as of the Closing Date an
opinion of Piper & Marbury L.L.P., counsel to the Underwriter, with
respect to the validity of the Indenture and the Securities, the
Registration Statement, the Prospectus and other related matters as
the Underwriter may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters; and
(k) on or prior to the Closing Date, the Company shall have
furnished to the Underwriter such further certificates and documents
confirming the representations and warranties contained herein and
related matters as the Underwriter shall reasonably request.
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in
all material respects satisfactory to the Underwriter and to Piper &
Marbury L.L.P., counsel for the Underwriter.
7. The Company agrees to indemnify and hold harmless the Underwriter
and each person, if any, who controls the Underwriter within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages and liabilities
(including without limitation the legal fees and other expenses incurred in
connection with any suit, action or proceeding or any claim asserted)
caused by any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or the Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by any
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities
are caused by any untrue statement or omission or alleged untrue statement
or omission made in reliance upon and in conformity with information
relating to the Underwriter furnished to the Company in writing by the
Underwriter expressly for use therein; PROVIDED, that the foregoing
indemnity with respect to any preliminary prospectus shall not inure to the
benefit of any Underwriter (or to the benefit of any person controlling the
Underwriter) from whom the person asserting any such losses, claims,
damages or liabilities purchased Securities if such untrue statement or
omission or alleged untrue statement or omission made in such preliminary
prospectus is eliminated or remedied in the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) and, if required by law, a copy of the Prospectus (as
so amended or supplemented) shall not have been furnished to such person at
or prior to the written confirmation of the sale of such Securities to such
person.
The Underwriter agrees to indemnify and hold harmless the Company, its
directors, its officers who sign the Registration Statement and each person
who controls the Company within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act, to the same extent as the foregoing
indemnity from the Company to the Underwriter, but only with reference to
information relating to the Underwriter furnished to the Company in writing
by such Underwriter expressly for use in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any preliminary
prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted
against any person in respect of which indemnity may be sought pursuant to
either of the two preceding paragraphs, such person (the "Indemnified
Person") shall promptly notify the person against whom such indemnity may
be sought (the "Indemnifying Person") in writing, and the Indemnifying
Person, upon request of the Indemnified Person, shall retain counsel
reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others the Indemnifying Person may designate in
such proceeding and shall pay the fees and expenses of such counsel related
to such proceeding. In any such proceeding, any Indemnified Person shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed
to the contrary, (ii) the Indemnifying Person has failed within a
reasonable time to retain counsel reasonably satisfactory to the
Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and
the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the Indemnifying Person
shall not, in connection with any proceeding or related proceeding in the
same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified
Persons, and that all such fees and expenses shall be reimbursed as they
are incurred. Any such separate firm for the Underwriter and such control
persons of Underwriter shall be designated in writing by the Underwriter on
Schedule I hereto and any such separate firm for the Company, its
directors, its officers who sign the Registration Statement and such
control persons of the Company or authorized representatives shall be
designated in writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment
for the plaintiff, the Indemnifying Person agrees to indemnify any
Indemnified Person from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any
time an Indemnified Person shall have requested an Indemnifying Person to
reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by the third sentence of this paragraph, the Indemnifying
Person agrees that it shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is entered into
more than 30 days after receipt by such Indemnifying Person of the
aforesaid request and (ii) such Indemnifying Person shall not have
reimbursed the Indemnified Person in accordance with such request prior to
the date of such settlement. No Indemnifying Person shall, without the
prior written consent of the Indemnified Person, effect any settlement of
any pending or threatened proceeding in respect of which any Indemnified
Person is or could have been a party and indemnity could have been sought
hereunder by such Indemnified Person, unless such settlement includes an
unconditional release of such Indemnified Person from all liability on
claims that are the subject matter of such proceeding.
If the indemnification provided for in the first and second paragraphs
of this Section 7 is unavailable to an Indemnified Person in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
Underwriter on the other hand from the offering of the Securities or (ii)
if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriter on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Underwriter on the other shall be deemed to be in the same
respective proportions as the net proceeds from the offering of such
Securities (before deducting expenses) received by the Company and the
total underwriting discounts and the commissions received by the
Underwriter bear to the aggregate public offering price of the Securities.
The relative fault of the Company on the one hand and the Underwriter on
the other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriter and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by PRO
RATA allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Person
as a result of the losses, claims, damages and liabilities referred to in
the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses incurred by
such Indemnified Person in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 7, in
no event shall the Underwriter be required to contribute any amount in
excess of the amount by which the total price at which the Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that the Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
The indemnity and contribution agreements contained in this Section 7
are in addition to any liability which the Indemnifying Persons may
otherwise have to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this Section 7
and the representations, warranties and covenants of the Company set forth
in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation
made by or on behalf of the Underwriter or any person controlling the
Underwriter or by or on behalf of the Company, its officers or directors or
any other person controlling the Company and (iii) acceptance of and
payment for any of the Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Underwriter, by notice given
to the Company, if after the execution and delivery of this Agreement and
prior to the Closing Date (i) there shall have occurred, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, any material adverse change or any
development involving a prospective material adverse change in or affecting
the condition, financial or otherwise, of the Company or the earnings,
business affairs, properties, management or business prospects of the
Company, whether or not arising in the ordinary course of business, (ii)
trading generally shall have been suspended or materially limited on or by,
as the case may be, any of the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago
Board of Trade, (iii) trading of any securities of or guaranteed by the
Company shall have been suspended on any exchange or in any over-the-
counter market, (iv) a general moratorium on commercial banking activities
in New York shall have been declared by either Federal or New York State
authorities; (v) there has occurred any downgrading in the rating of the
Company's debt securities by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Exchange
Act); or (vi) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis
that, in the judgment of the Underwriter, is material and adverse and
which, in the judgment of the Underwriter, makes it impracticable to market
the Designated Securities on the terms and in the manner contemplated in
the Prospectus.
9. If, on the Closing Date, the Underwriter shall fail or refuse to
purchase Securities and the aggregate principal amount of Securities with
respect to which such default occurs is more than one-tenth of the
aggregate principal amount of Securities to be purchased, and arrangements
satisfactory to you and the Company for the purchase of such Securities are
not made within 36 hours after such default, this Agreement shall terminate
without liability on the part of the Company. In any such case either you
or the Company shall have the right to postpone the Closing Date, but in no
event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
10. If this Agreement shall be terminated by the Underwriter because
of any failure or refusal on the part of the Company to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason the Company shall be unable to perform its obligations under this
Agreement or any condition of the Underwriter's obligations cannot be
fulfilled, the Company agrees to reimburse the Underwriter who has so
terminated this Agreement, for all out-of-pocket expenses (including the
fees and expenses of their counsel) reasonably incurred by the Underwriters
in connection with this Agreement or the offering of Securities.
11. This Agreement shall inure to the benefit of and be binding upon
the Company, the Underwriter, any controlling persons referred to herein
and their respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
other person, firm or corporation any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision herein
contained. No purchaser of Securities from the Underwriter shall be deemed
to be a successor by reason merely of such purchase.
12. Any action by the Underwriter hereunder may be taken by you, and
any such action taken by you shall be binding upon the Underwriter. All
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriter shall be given at
the address set forth in Schedule II hereto. Notices to the Company shall
be given to it at Merry Land & Investment Company, Inc., 000 Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxx 00000, Attention: X. Xxxxxxx Houston.
13. MISCELLANEOUS. This Agreement may be signed in counterparts,
each of which shall be an original and all of which together shall
constitute one and the same instrument. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York,
without giving effect to the conflicts of laws provisions thereof.
Very truly yours,
MERRY LAND & INVESTMENT COMPANY,
INC.
/s/
By:_______________________________________
Name: X. Xxxxxxx Houston
Title: President
Accepted: October 27, 1997
FIRST UNION CAPITAL MARKETS CORP.
/s/
By:______________________________
Name:
Title:
SCHEDULE I
Underwriting Agreement dated: October 27, 1997
Registration Statement No.: 33-65067
Title of Securities: 6.69% OF NOTES DUE 0000
Xxxxxxxxx principal amount: $50,000,000
Price to Public: $50,000,000
Underwriting Discount: .600%
Indenture: Indenture dated as of February 1, 1995, and
the Supplemental Indenture dated as of June 1,
1995, both between Merry Land & Investment
Company, Inc. and First Union National Bank of
Georgia
MATURITY: OCTOBER 30, 2006
Interest Rate: 6.69%
Interest Payment Dates: MAY 1 AND NOVEMBER 1
Optional Redemption Provisions: REDEEMABLE AT ANY TIME AT THE OPTION OF THE
COMPANY, IN WHOLE OR IN PART, AT A REDEMPTION
PRICE EQUAL TO THE SUM OF (I) PRINCIPAL AMOUNT OF
THE NOTES PLUS ACCRUED INTEREST TO THE REDEMPTION
DATE, (II) PLUS THE MAKE WHOLE AMOUNT, IF ANY.
Sinking Fund Provisions: None
Other Provisions: As specified in the Prospectus Supplement
dated OCTOBER 27, 1997 relating to the Securities.
Closing Date and Time of Delivery: October 30, 1997, 10:00 A.M.
Closing Location: Piper & Marbury L.L.P.
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Address for Notices
to Underwriter: c/o First Union Capital Markets Corp.
000 XXXXX XXXXXXX XXXXXX
XXXXXXXXX, XXXXX XXXXXXXX
ATTENTION: XXX XXXXXXXX
SCHEDULE II
SUBSIDIARIES
ML Apartments Limited
Merry Land Apartment Communities, Inc.
ML Texas Apartments L.P.
ML North Carolina Apartments, L.P.
ML Tennessee Apartments, L.P.
ML Alabama Apartments, Inc.
MLA, Inc.
XxXxxxxx Riverhill, Ltd.
The Xxxxxxxx Apartment Homes, Ltd.
XxXxxxxx Hidden Lakes, Ltd.
